Petroleum Supply, Marine Transportation Technology, and the Emerging International Order of the Post World War One Period

Abstract

At Versailles in 1919 President Wilson described three arenas of economic struggle, mediated by technology and geopolitics, that he saw developing between America and Britain as a new international order emerged: struggles over international transportation, petroleum, and international communication. The case of international transportation, almost all of it maritime in the 1920s, is intimately connected with that of the problem many observers saw with an insecure and possibly faltering global supply of petroleum. America dominated the early period of global petroleum supply, especially after the strike at Spindletop in Texas in 1901, but Spindletop was faltering by 1920. Even before World War One broke out German and British War Aims thus began to focus on the likely oil reserves of the Middle East that America could not control, Germany via the mineral rights the company was granted along the line of the Berlin to Baghdad Railway concession of 1903 and Britain via the Sykes-Picot-Sazanoff agreement of 1916, the latter resulting in the eventual creation of Iraq. In the run-up to the war oil-firing of steam turbine engine warships was seen as a technology that would substantially increase the fighting capacity of naval vessels through, amongst other things, radically easier refueling and a substantial reduction in stokehold crew size. Operators of merchant vessels followed a similar line of reasoning for a new generation of steam turbine powered ships coming to dominate the Atlantic shuttle by virtue of their speed. The war, however, proved a huge technology forcer in the area of diesel engines, which even in their early form were ideally suited to powering merchant ships, offering substantial savings in fuel and/or labor costs over steamships. Commentators in the 1920s were very clear on the relationship between the petroleum and marine transportation struggles, arguing that whoever controlled the right mix of marine transportation technology, in particular that of the merchant marine, and petroleum supply would control the emerging post-war international order. Of the major powers neither Britain nor Germany did particularly well in shifting their merchant marines to diesel power, America did very poorly. America’s strength was in continuing to control the global oil supply.